The company’s top line will be benefited by the growing customer base as well as the strength in the Software and Support segment. The customers are continuing to select Nutanix as a low-cost alternative instead of other vendor offerings. However, Nutanix’s bottom line will be hurt by the increase in costs and expenses as more deals are being added under its domain.
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Nutanix ended the fourth quarter of fiscal 2018 with 10,610 end-customers, adding 1,000 new end-customers in the quarter. The company also expanded an existing customer engagement by closing a deal greater than $20 million in the fourth quarter.
The company posted a wider loss for the fourth quarter due to a rise in operating expenses. Revenue increased 20% as Nutanix continued to execute its shift toward rising software revenue. Software and support revenue jumped 49% and billings climbed 37%.
For the first quarter, the company had expected revenue in the range of $295 million to $310 million, implying software and support revenue growth of about 40% to 45% year-over-year. Adjusted loss was anticipated to be $0.26 to $0.28 per share. Non-GAAP operating expenses are predicted to be $280 million to $290 million.
The company’s forecast reflects a faster removal of pass-through hardware than originally expected, accelerating the reduction of zero margin billings and revenue with the benefit of improved gross margins.
Shares of Nutanix opened higher on Monday and is trading in the green territory during mid-afternoon. The stock has risen over 16% in the year so far and over 19% in the past year.